How to pick the best travel credit card

Jan 30, 2017

Points, free hotel stays, cash back, amenities – the many perks of a travel credit card holder. How best to wade through the many offers, benefits, and requirements when researching potential travel credit cards?

I recently underwent an exhaustive search to find the best travel reward card. I considered which airline I am most likely to fly in the coming year, how much spend was necessary to receive the sign up bonus offer (and if such a spend was realistic), and the overall value of the benefits offered.

1) Sign up bonus

Points. Cash. Airline miles. Hotel rooms. Travel cards entice you with attractive sign-up bonuses sure to appeal to any avid traveler. But make sure you read the fine print, and understand the requirements you must meet in order to receive the sign up bonus. Often, you will need to spend a certain amount within a specified time frame (say $3000 in the first three months) in order to fully redeem the bonus. Is such spending not only practical, but feasible?

A quick tip - check to see when the initial spending window starts. If the clock starts the day you are approved for the card (and not when you actually activate the card once received), get a jump start on your spending. I was able to receive the card number online, and punched it in to frequently used sites (Seamless, Amazon) to start maximizing my spend on day one.

Also research what airlines, hotels, or restaurants apply to each card. How, when, and if you will actually utilize this network will be the deciding factor. Keep in mind a specified airline or hotel’s partner network, as points can often be redeemed within alliance members.

2) Annual perks

In addition to the sign-up bonus, what else does the card offer you? What are the ongoing perks of a travel credit card? For some, it is airline lounge access or a credit towards airline amenities (alcohol/food on board, seat selection, free checked baggage). Again, read the fine print and evaluate which perks are most beneficial to you and your travel needs.

3) Everyday spend

Put all of your expenses on your credit cards and then make sure to pay off your entire balance each month or else the interest paid will most likely negate any of the points you accrued.

And – look at the annual fee. Often, the fee is waived during the first year of use (check the fine print). But know what to expect and evaluate if the annual fee justifies the card in the first place.

4) Redemption value

“Accruing points is only half of the equation. Learn the ins and outs of each rewards program you’re focusing on to make sure you’re maximizing your redemptions. All travelers have different priorities, but one way to determine whether you’re getting a decent redemption value is to divide the price of a flight or hotel stay by the number of miles or points you’d need to redeem for it, and see how that cents value stacks up to my valuation. The higher value you get, the better the deal you’re getting.”

A few caveats:

As with any financial decision, do not take any advice without your own due diligence. This is meant as a quick primer as you start your search. Everyone must evaluate their particular financial needs and situation to pursue the best path. According to Million Mile Secrets, collecting points and miles may not be for you if you do not pay your bills on time, your credit score is lower than 700, you have difficultly paying attention to detail, or you do not accurately track your credit card balances.